A governmental committee has been debating a solution for problems created by 24 failed real estate ventures in Saudi Arabia's Eastern region. The investments in these projects surpassed 1 billion Saudi Riyals ($266.5 million), reported the Saudi newspaper, Al-Watan, on October 9.
A member of this committee, Mohammad Bukhamsin, told the daily that the committee actually succeeded in solving the problem of one of these failed ventures. Bukhamsin added that the main problems that the other ventures are facing were connected to low budgets obtained for development and services supply, or the death of the owner of the company which offered one of these ventures.
These failed ventures caused a loss of capital and affected negatively upon the market's credibility and the sector's performance, he noted. Bukhamsin mentioned that the new governmental restrains imposed upon real estate ventures came as a response to the large flow of investments to this sector and the wish to control the creating of new real estate businesses.
The Saudi real estate market saw a boom during recent years. This trend encouraged investors to turn toward real estate ventures supplying alternatives for Saudi citizens who wish to purchase housing units.